Mining major Anglo American, which owns no lithium mines, has entered into an agreement with Finnish Minerals Group (FMG) to support the European country’s “battery strategy”.
The announcement on Monday comes just two months after Reuters reported that Anglo American was looking at for lithium offtake deals as demand for electric vehicles (EVs) continues to rise.
Alison Atkinson, projects & development director at Anglo American, said Finland provides a stable and secure source of many of the metals and minerals needed for the world to decarbonise.
“Finland is a highly attractive investment destination and has a strong heritage in both mining and innovation. We look forward to working with FMG, whose mission is to responsibly maximise the value of Finnish minerals, to explore the wealth of opportunities that our agreement could offer,” Atkinson said.
“This agreement further strengthens our commitment to Finland as well as to our Sakatti project, a true polymetallic ore body very much aligned to Finland’s and the EU’s critical minerals priorities ...”
Lithium is a key metal used in EV batteries. Demand for the metal is expected to grow as economies worldwide pump billions of dollar into transitioning to green energy.
A few years ago, materials such as lithium and cobalt were minor materials, but it has since grown in stature in value as mining companies hunt for green commodities. While Anglo does not own lithium assets, it owns other critical assets used to build renewable infrastructure, such as copper.
The announcement of the agreement with FMG comes just a few weeks after Anglo announced the launch of a research & development project in collaboration with GEM, one of China’s largest battery and battery material recyclers. That agreement is “to explore new and more efficient technologies for the use of existing and alternative raw materials to be used in batteries for electric vehicles”.
China is the world’s largest EV market, with a projected 8-million vehicles sold in 2023.
Anglo’s share price took a beating in December after it presented a strategy to lower medium-term capital expenditure by $1.8bn between now and 2026 to soften the blow of weaker commodity prices. Platinum group metals (PGMs) came under severe pressure in 2023, with many miners in the sector retrenching thousands of workers.
The London- and JSE-listed group is the majority owner of Kumba Iron Ore, Anglo American Platinum (Amplats) and De Beers, which together contribute hugely to SA’s corporate tax base and mining royalties.
FMG is a special-purpose company wholly owned by the state of Finland, aiming at developing the mining and battery industry in the European country. The company has been working at positioning Finland to profit from the growing demand for lithium in energy storage.
Jani Kiuru, a senior executive at FMG, said Finland is well positioned in terms of its natural resources and the country’s investment across the entire battery value chain, from mineral extraction to recycling.
“Exploring joint opportunities with Anglo American is a natural choice for us as they already know the Finnish operational environment. In addition, the company has a long history in mining and is a forerunner in sustainability,” Kiuru said.
“We believe this collaboration reinforces both parties by combining local and global know-how in sustainability and technological development, thus maximising the value of Finnish minerals responsibly. We see there is a mutual understanding on the vast possibilities and importance of Finnish minerals for the green transition.”
Sibanye-Stillwater has invested hugely in Finland, in partnership with FMG. Due to the downturn in the commodity markets, CEO Neal Froneman has set his sights on battery metals, and went about building lithium mines and a nickel refinery.
FMG owns 20% of the Keliber lithium refiner in Finland, while Sibanye owns the rest.
Sibanye in October said it expected the aggregated project capital for the Keliber project to be €656m, compared with the previously estimated €588m.
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